Bankrupt PES Refinery Sold to Developer

A federal bankruptcy court judge turned thumbs down Wednesday on an attempt to restart operations at Philadelphia Energy Solutions, which has been closed since a devastating fire in June shut the East Coast's largest oil refinery.

Judge Kevin Gross instead approved a $252 million bid to purchase the refinery, demolish it and redevelop the site as a mixed-use industrial park.

Federal investigators believe a ruptured pipe elbow released process fluid containing hydrofluoric acid that formed a flammable vapor cloud. Measurement of the damaged elbow revealed that it had corroded to only 0.012 of an inch thickness, about half that of a credit card.

Gross said the decision to sell to Hilco Redevelopment Partners, specialists in purchasing obsolete industrial sites to remediate for further development, was “clearly in the best interests of the community” because of the refinery’s “numerous and repeated problems,” reports the Philadelphia Inquirer.

PES had previously filed for bankruptcy in 2018. In March the same year the Environmental Protection Agency allowed the company to pay roughly half of nearly $350 million owed under the federal Renewable Fuel Standard.

Rival bidder Industrial Realty Group, working in conjunction with former PES chief Philip Rinaldi, sought to restart the refinery. That effort was supported by the United Steelworkers, which represented more than 600 of the refinery’s 1,100 workers.

The Trump administration had supported continued oil refining at the 1,300-acre PES site.